In an unfunded pension system where current contributions are paid out to current beneficiaries, the total amount of funds available to invest _____ and the interest rate _____
a. falls; falls
b. rises; rises
c. falls; rises
d. rises; falls
c
Economics
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Individuals making decisions about how much to purchase of a product with an external benefit base their decisions on which of the following?
A) the price and marginal private benefit B) the economically efficient output C) the price and the marginal social benefit D) the size of the deadweight loss
Economics
If the going rate of interest were 8 percent and the expected profit rate were 14 percent, then the opportunity cost of a firm carrying out a $100,000 project for one year with its own funds would be
A. 0.
B. $6,000.
C. $8,000.
D. $14,000.
Economics